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Forbes: SCO Hitches Its Wagon To Linux

"...executives at SCO (nasdaq: SCOC), formerly known as the
Santa Cruz Operation, are debating whether Linux will be its
salvation. The software maker certainly needs saving. SCO says its
fiscal third quarter would fall far short of estimates. It will
lose between 50 cents and 55 cents per share, not the 13 cent loss
analysts had expected. The company blamed lingering year-2000
concerns and anemic demand for its flagship Unix server software,
called UnixWare. Naturally, the stock was hammered, losing about
26% of its value to close at $4 on July 11. The news comes a few
months after the company restructured its product divisions, laid
off 70 employees and took a $5.9 million restructuring charge."

"So, the company is hitching its wagon to--what else?--Linux.
SCO has been selling support services for Caldera (nasdaq:
CALD) and TurboLinux for about 6 months, and it has already given
some intellectual property to the Linux open source community.
But SCO hasn't yet taken the big step--distributing Linux."

"But that's coming. Sources say it's working out an
arrangement with France's MandrakeSoft to distribute its
Linux-Mandrake operating system. SCO will use Linux-Mandrake
as the base OS and add some features like clustering... SCO Chief
Executive Doug Michels wouldn't comment specifically on a deal with
MandrakeSoft, but he says the company will become a Linux
distributor."